The cost of therapy is one of the most common challenges for people seeking mental health support. A payor is the entity — often an insurance company — that covers some or all mental health service costs.
Understanding how insurance works can help you better navigate the mental health care system. In this guide, learn how therapy is covered, how to verify your benefits, and what to expect when using coverage. You can also explore how different providers cover mental health services and compare your options.
Key takeaways
- A payor is the entity — such as a private insurance company, employer, or government program — that covers some or all of the cost of health care, including mental health services.
- Most private insurance plans and government programs like Medicaid and Medicare are required by federal law to cover mental health care on par with physical health care.
- Key cost terms to understand: premium, deductible, copay, coinsurance, and in-network vs. out-of-network. These determine what you’ll actually pay for therapy.
- Coverage details vary by payor and plan — always verify your specific benefits before booking a first session.
- Grow Therapy works with a wide range of insurance companies. You can filter by your plan to find an in-network therapist and see your estimated cost upfront.
How does insurance cover therapy?
Coverage levels, networks, and services provided can vary among insurance companies. However, there are several key definitions and roles that can serve as a foundation as you learn more about how payors can support mental health.
- Copay: Flat fees that you would pay for each covered service, including mental health appointments like visiting a therapist or taking part in a virtual session. Copays can vary significantly from insurance company to insurance company.
- Premium: The regular amount you (or your employer) pay an insurance company on a set schedule to keep a plan active. Depending on your plan, these payments might occur monthly, quarterly, or at another regular interval.
- Deductible: The amount you’re required to pay before your insurance company begins sharing the costs. For example, if your plan has a $1,000 deductible, you’d need to pay for the first $1,000 of covered services before insurance kicks into gear. It’s worth noting some services may not be subject to the deductible, meaning you won’t have to pay the deductible before insurance discounts start.
- Coinsurance: Once you’ve met your deductible, you might still be responsible for covering a percentage of future costs while your insurance company covers the rest. That share of expenses is called coinsurance and it varies from plan to plan.
- In-network: A provider that’s included in an insurance company’s network is known as being “in-network.” That typically means a provider has a standing agreement with an insurance company to provide services at set rates. Seeing providers that aren’t in-network may result in higher out-of-pocket costs.
Private insurance vs. government-backed programs
Most insurance coverage comes from either private insurance companies or government-backed programs like Medicaid and Medicare. For private insurance, individuals typically enroll either on their own via a health insurance marketplace, or through their employer. Enrollment usually occurs during a set period of the year, such as open enrollment, or after a qualifying life event, like starting a new job, getting married, or losing your parents’ coverage when you turn 26.
For Affordable Care Act plans, open enrollment typically runs from November 1 to January 15. For employer-sponsored insurance, enrollment periods are often held in the fall.
People can enroll in Medicaid or Medicare if they meet certain criteria such as income levels, household size, age ranges, and more. Medicaid enrollment can happen throughout the year. For Medicare, the Initial Enrollment Period (IEP) takes place near your 65th birthday. After that, the Annual Enrollment Period (AEP) happens from Oct. 15 to Dec. 7.
Did you know?
Federal law requires most insurance plans to cover mental health services at the same level as physical health care. The Mental Health Parity and Addiction Equity Act (MHPAEA) prohibits insurers from imposing more restrictive limits on mental health benefits than they apply to medical or surgical benefits.
What types of therapy are covered by insurance?
Coverage varies by payor, but many insurance plans cover a range of mental health services. This typically includes individual and family therapy as well as other forms of mental health care, such as intensive outpatient programs. Some insurance companies may cover telehealth therapy options more broadly than others.
Some common therapies that are frequently covered by insurance companies include:
- Cognitive behavioral therapy (CBT): CBT is a common form of therapy that includes structured, skills-based treatment.
- Substance use disorder (SUD) treatment: These include therapies and other programs specifically designed to support recovery from alcohol and substance use disorders.
- Psychotherapy: A broad term for treatments that involve talking and interacting with a licensed mental health professional.
- Inpatient services: Treatment provided in a hospital or rehab setting, often involving overnight stays and 24/7 care.
This is not a complete list of all the therapy types or forms of mental health treatment that are available. Additionally, when looking for a specific type of care, it’s important to review your insurance plan details to confirm which therapy options are covered.
What’s the difference between Medicaid and Medicare?
Both are government-backed health insurance programs, but they serve different populations. Medicaid is a state and federally funded program for low-income individuals and families, including children, pregnant women, people with disabilities, and some seniors.
Eligibility and covered services vary by state, and enrollment is available year-round. Medicare is a federal program primarily for people aged 65 and older, as well as some younger people with disabilities. It’s divided into parts — Part A covers inpatient care, Part B covers outpatient services including therapy, and Part D covers prescription medications.
If you’re unsure which program you might qualify for, your state’s health and human services agency can help you determine eligibility.
How do I verify insurance coverage for therapy?
Verifying whether an insurance company offers coverage for a specific need, like therapy, can be a challenge. But there are resources available to help guide you through the process so you can understand your coverage options.
How can I learn more about insurance companies?
The sheer number of insurance companies may seem overwhelming at first. Each insurer below has its own dedicated coverage guide on Grow Therapy — click through to find out what your specific plan covers, how to verify your benefits, and how to find an in-network therapist.
- Aetna
- All Savers Insurance Company
- Ambetter
- Amerihealth Administrators Health Insurance
- Amerihealth New Jersey
- Amerihealth Pennsylvania
- AvMed
- Buckeye Health Plan
- Central California Alliance for Health
- Cigna Healthcare
- Evernorth Insurance
- Florida Blue
- Florida Medicaid
- Georgia Medicaid
- Gold Coast Health Plan
- Harvard Pilgrim Health Care
- HUSKY Health
- Indiana Medicaid
- Magellan
- Medi-Cal
- Medicare
- Minnesota Medicaid
- Ohio Medicaid
- Optum
- Oscar Insurance
- Oxford Health Plans
- Surest Insurance
- TennCare
- Texas Medicaid
- Tufts Health Plan
- United Medical Resources
- UnitedHealthcare
- UnitedHealthcare Shared Services
- Virginia Medicaid
- Wellcare Medicare
Once you’ve identified your plan, the next step is finding a therapist who accepts it.
Final thoughts
Understanding how payors work — and what your specific plan covers — is one of the most practical steps you can take before starting therapy. The terminology can feel dense at first, but once you know the difference between a premium and a deductible, and understand what in-network means for your costs, the process becomes significantly more manageable.
The insurance company directory above is a good starting point for learning what your specific payor covers. From there, verifying your benefits directly with your insurer before your first session is always the safest move. On Grow Therapy, you can filter by insurance plan, see in-network therapists with real-time availability, and get a cost estimate upfront — so there are no surprises when you show up.
Ready to find a therapist covered by your insurance?
Frequently asked questions
A payor is the entity responsible for covering some or all of the cost of health care services. In most cases, this is a private insurance company, an employer-sponsored plan, or a government program like Medicaid or Medicare. When you use insurance for therapy, your payor reimburses your therapist directly or covers a portion of the session cost after you’ve paid your copay or met your deductible.
In most cases, yes. Under the Affordable Care Act and the Mental Health Parity and Addiction Equity Act, most insurance plans are required to cover mental health services — including therapy — on par with physical health care. Coverage specifics vary by plan, so always verify your benefits before booking.
A copay is a fixed amount you pay per session — for example, $30 — regardless of the total cost of the visit. A deductible is the amount you must pay out of pocket before your insurance starts contributing to costs. Some plans waive the deductible for mental health services, meaning you only owe your copay from the first session. Check your Summary of Benefits and Coverage to confirm how your plan works.
You can search your insurer’s online provider directory, call member services, or use Grow Therapy to filter by your insurance plan and see in-network therapists with real-time availability. On Grow Therapy, you can also see your estimated cost before booking.
Medicaid is a state and federally funded program for low-income individuals and families — eligibility and covered services vary by state. Medicare is a federal program primarily for people aged 65 and older. Both cover mental health services including therapy, though the specifics differ. See the Content Toggle above for a fuller breakdown.